INCOME TAX OFFICE, WARD-54(1), NEW DELHI, NEW DELHI V. ARTI ARORA, NEW DELHI

MA 311/DEL/2025

AI Insights

The case revolves around a Miscellaneous Application by the Revenue seeking rectification of a Tribunal order that dismissed their appeal based on the low tax effect. The appeal pertained to the addition of Rs.1,56,86,090 made under section 69A of the Income Tax Act, 1961, concerning the assessee's trading in shares of M/s. Lifeline Drugs & Pharma Ltd., which were alleged to be penny stocks. The Department argued that the issue fell under exceptions to the low tax effect policy as per CBDT Circular No.5/2024. The assessee opposed the application, citing a previous Tribunal decision that the shares in question were not penny stocks. The Tribunal, considering the merits of the case and the specific nature of the shares involved, decided to recall the earlier order and restore the appeal for a detailed examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 791421 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-12-2025
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 27-08-2025
• Other Referred Cases: Anoop Jain vs. CIT 2020 SCC Online ITAT 1054
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: S SANJAY AGARWAL; SUMAKSH MAHAJAN
• Keywords: Tax effect

Judgement Text

" आयकर अपीलीय अिधकरण िदʟी पीठ “ए”, िदʟी ŵी िवकास अव̾थी, Ɋाियक सद˟ एवं ŵी मनीष अŤवाल, लेखाकार सद˟ क े समƗ IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A”, DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI MANISH AGARWAL, ACCOUNTANT MEMBER MA No. 311/Del/2025 (Arising out of ITA No.3534/Del/2024, A.Y 2015-16) Income Tax Officer, Ward 54(1), Delhi ...... आवेदक/Applicant बनाम Vs. Arti Arora, A 30 Dayanand Colony, Lajpat Nagar, Delhi 110024 PAN: ASTPA-9914-G ..... ᮧितवादी/Respondent आवेदक/Applicant : Ms. Ankush Kalra, Sr. DR ŮितवादीȪारा/Respondent by : S/Shri Sanjay Agarwal & Sumaksh Mahajan, Chartered Accountants सुनवाई कᳱ ितिथ/ Date of hearing : 21/11/2025 घोषणा कᳱ ितिथ/ Date of pronouncement : 10/12/2025 आदेश/ORDER PER VIKAS AWASTHY, JM: This Miscellaneous Application has been filed by the Revenue seeking rectification of Tribunal order dated 11.03.2025 vide which appeal of the Revenue was dismissed on account of low tax effect. 2. Ms. Ankush Kalra, representing the Department submitted that the issue involved in appeal pertains to penny stock shares, hence, the issue falls under exceptions listed in CBDT Circular No.5/2024 dated 15.03.2024. She thus prayed for recalling of the Tribunal order dated 11.03.2025. 3. Per contra, Sanjay Agarwal appearing on behalf of the assessee vehemently opposed the Miscellaneous Application filed by the Department. The ld. Counsel Printed from counselvise.com 2 MA No.311/DEL/2025 (AY2015-16) submits that the CIT(A), while adjudicating the issue has deleted the impugned addition of Rs.1,56,86,090/- after comprehensive examination on merits. He further submitted that a perusal of the grounds of appeal filed by the Revenue before the Tribunal would show that the Revenue has nowhere stated that the issue raised in appeal falls under the exceptions provided in Clause 3.1 of Circular No. 5/2024 (supra). 4. Without prejudice to his primary objections, the ld. AR of the assessee submits that even if the contention of the Department is accepted, the scrip traded by the assessee—M/s. Lifeline Drugs & Pharma Ltd. is not a penny stock. The Coordinate Bench of the Tribunal in the case of Anoop Jain vs. CIT 2020 SCC Online ITAT 1054 has held that M/s. Lifeline Drugs & Pharma Ltd. is not a shell company. The Tribunal further held that the shares of said company do not fall in the category of penny stock. 5. Both sides heard. The Revenue is seeking recalling of the Tribunal order dated 11.03.2025 as appeal of the Revenue was dismissed on account of low tax effect. The contention of the ld. DR is that the issues involved in appeal fall under the exceptions specified by the Board vide Circular No. 5/2024 (supra). We find that in the grounds of appeal, the Revenue has assailed deleting the additions of Rs.1,56,86,090/- made by Assessing Officer (AO) u/s.69A of the Income Tax Act,1961(hereinafter referred to as ‘the Act’). The assessee has placed reliance on the decision of Coordinate Bench in the case of Anoop Jain vs. CIT (supra), wherein the script of M/s. Lifeline Drugs & Pharma Ltd. was subject matter of dispute. The Revenue has alleged the script to be penny stock. In the present case as well the same script is the subject matter of consideration. Since, the issue relates to the script which has been alleged to be penny stock, we are of considered view that the issue in the present appeal needs to be decided on merit. Printed from counselvise.com 3 MA No.311/DEL/2025 (AY2015-16) Hence, the order dated 11.03.2025 is recalled for adjudication of appeal on merits and the appeal is restored to its original number. 6. The Registry is directed to list the appeal for hearing in due course after notice to both sides. 7. In the result, Miscellaneous Application of the Revenue is allowed. Order pronounced in the open court on Wednesday the 10th day of December, 2025. Sd/- Sd/- (MANISH AGARWAL) (VIKAS AWASTHY) लेखाकार सद˟/ACCOUNTANT MEMBER Ɋाियक सद˟/JUDICIAL MEMBER िदʟी / Delhi, ᳰदनांक/Dated 10/12/2025 NV/- ᮧितिलिप अᮕेिषतCopy of the Order forwarded to : 1. अपीलाथᱮ/The Appellant , 2. ᮧितवादी/ The Respondent. 3. The PCIT/CIT(A) 4. िवभागीय ᮧितिनिध, आय.अपी.अिध., िदʟी /DR, ITAT, िदʟी 5. गाडᭅ फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar) ITAT, DELHI Printed from counselvise.com "